The “Why commercial real estate?” question is one of the most common interview questions asked of analyst candidates at real estate firms, and the way you answer this can have a big impact on how you stack up against other candidates in the running for a job.
And while the textbook answer related to real estate being tangible is definitely the most common response here, at best, this answer will just make you blend in with the rest of the candidate pool.
So to help you answer this question in a way that makes you stand out, this article walks through three of the best answers you can give to the “Why commercial real estate?” question, and how you can tailor each of these to your own unique situation.
If video is more your thing, you can watch the video version of this article here:
Talk Through Interest in Day-To-Day Responsibilities
My favorite type of answer to this question is one which talks through a candidate’s interest in the day-to-day aspects of a commercial real estate analyst role, specifically related to working with numbers and building relationships.
People looking to break into the real estate industry often say they chose the field because real estate is tangible, but touring fancy buildings in desirable locations is actually a very small piece of an analyst’s job.
In an entry-level role, most of your days are going to be spent running numbers in Excel and/or ARGUS, and connecting with clients, brokers, or investors to get deals done.
The most successful people I know in this industry have a unique ability to combine a strong knowledge of real estate financial analysis with the ability to genuinely connect with other people, and if you focus your answer to this question on your interests in underwriting and relationship building, this shows an employer that your expectations of the job are realistic and you’re likely to stick around over the long-term.
Talk Through How Real Estate Has Impacted Your Life
Usually, this answer will consist of talking through some sort of real estate-related involvement in your past, either through personal work experience you’ve had within an adjacent industry, or through a close relationship with a family member or friend who was directly involved in the real estate business.
A lot of people answer this question by talking through their experience in a field like architecture or construction, and describe being drawn to the industry after working with developers and investors. Accountants and attorneys also usually have good material to work with here, being able to speak to their time helping clients do deals and their desire to get in on the action.
If you don’t have experience directly in an adjacent field, a good answer here could also involve a personal story of someone close to you (often a friend or family member) who was a developer, investor, or broker, and how that person piqued your interest in the business.
You could also share a personal story that says more about your mission and why you’re setting out to build a commercial real estate career, whether that’s talking through your goal to revitalize underserved communities, or your commitment to rebuilding a certain city that your family calls home.
The most impactful answers here are going to show that you have plans to be in this industry for a very long time, either because you’ve known that this was what you were going to do from a very young age, you’ve already been involved with the industry through work in another field, or you have a strong personal mission to make an impact through real estate.
Talk Through Why You Believe in The Real Estate Asset Class
It’s no secret that, just like other parts of high finance, a lot of people get into the commercial real estate industry because of the income and wealth building potential that comes along with a career in this field.
Employers know this, and this is usually seen as a good thing, as long as it’s clear that you’re committed to achieving those financial goals within the real estate industry (over other career paths).
You certainly don’t want to detail out your entire personal financial plan during an interview, but what you can do is talk through why you believe in the real estate industry’s growth prospects going forward, and even better, why you believe in the specific property type that you’d be working on if you ended up joining the team.
Belief in the real estate asset class isn’t just helpful in showing industry commitment, but this is also necessary to grow within the company, especially when you’re moving into roles where you’ll be raising equity from investors, pitching deals to potential buyers, or lending on commercial properties at a bank or insurance company.
One of the best pieces of advice I was given early on in my career was to think like an owner of the company you’re working for, and employers want their team members to be on board with their investment thesis.
For example, if you’re applying for a job at a multifamily development firm, talking through how the undersupply of housing stock will lead to rent and value growth in the residential sector over the next decade will be music to the ears of a hiring manager.
This is especially true at the analyst level, since you’ll be the one responsible for putting together investment memos and crafting the narrative used to raise capital and sell deals.
How To Prepare For Commercial Real Estate Interviews
If you’re preparing for a commercial real estate interview and trying to build up your technical skills, or you’re in the process of tightening up your resume to land an interview in the first place, make sure to check out our all-in-one membership training platform,Break Into CRE Academy.
A membership to the Academy will give you instant access to over 120 hours of video training on real estate financial modeling and analysis, you’ll get access to hundreds of practice Excel interview exam questions, sample acquisition case studies, and you’ll also get access to the Break Into CRE Analyst Certification Exam. This exam covers topics like real estate pro forma and development modeling, commercial real estate lease modeling, equity waterfall modeling, and many other real estate financial analysis concepts that will help you prove to employers that you have what it takes to tackle the responsibilities of an analyst or associate at a top real estate firm.
As always, thanks so much for reading, and make sure to check out theBreak Into CRE YouTube channelfor more content that can help you take the next step in your real estate career.
